Lupin to invest in Japan; eyes 20 launches

Lupin, one of India's top five pharmaceutical companies, is planning to make significant investments in Japan, the second biggest pharmaceutical market in the world.DIVYA RAJAGOPAL | ET Bureau | February 25, 2016, 08:33 IST

Mumbai:Lupin, one of India's top five pharmaceutical companies, is planning to make significant investments in Japan, the second biggest pharmaceutical market in the world.

“Japan is shaping well for us. We see 10-15% growth in yen terms. There are near-term challenges like price cuts in the next three years. But we are expanding,” Lupin MD Nilesh Gupta told ET. Lupin is the only Indian drug-maker to have a base in Japan.

Gupta said the company is setting up a new plant in Japan and investing .`100 crore in a manufacturing facility in India which will cater to the Japanese market.

Lupin, which entered Japan through acquisitions, reported 9% year-on-year growth in its business in the country in the third quarter of financial year 2016. This, to a large extent, made up for the slow growth in the US market, which accounts for 95% of the company's volumes.

On the outlook for the coming quarters, Gupta said there are signs of a pick up after a dull third quarter. “Q4 will be better. So, that would be a strong start. We will have Gavis (its recent acquisition) coming in, and we are expecting 20 new launches.”

Post the acquisition of US based Gavis last year, which was the largest buyout by an Indian pharma company, Lupin said it will cherrypick its buys starting then. Next the company may go in for an acquisition on the speciality business side, the share of which has fallen to below 10% in the US market.

Gupta said it has become "impossible to grow" in markets like Brazil and Mexico where currency depreciation is hurting Indian exporters.

Clarifying on the rumours about three years ago that the company was looking to sell its domestic business, Gupta admitted that they had looked at partially diluting the stake in the domestic business to Japanese drug maker Takeda, but the deal fell through as Takeda wanted a controlling stake. That plan is now shelved, he added.

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